Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
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Question
Chapter 12, Problem 12.31AE
To determine
The best project in which company S should invest.
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Students have asked these similar questions
What are the benefits of capital budgeting tools to educational institutions? How does they use capital budgeting tools? Provide examples and explain. Minimum 200 words
Additionally, regarding the project, please do not assume that the reader is familiar with the subject areas that you are writing about. Therefore, definitions, assumptions, facts, and analyses are required in this assignment.
Further, there are four questions that are being asked. Three questions need supporting calculations to validate your answers. Kindly show your calculations. Also, a review of Learning Objective 4 in chapter 21 would be a good place to start with this assignment (Lease Capitalization, Bargain purchase Option.) Below are the questions for your convenience.
What ethical issue is at stake?
Should the controller's argument be accepted if she does not really know much about copier technology? Would it make a difference if the controller were knowledgeable about the rate of change in copier technology?
What should Suffolk do?
Objective: This case deals with the capital budgeting techniques of Net Present Value (i.e. NPV) and
Internal Rate of Return (i.e. IRR), Payback Period and Profitability Index.
In this case, students will compare seven projects considering the are dependent projects using NPV and
IRR, Pay back Period and Pl and choose the best project. They will learn about NPV and IRR methods and
their advantages and disadvantages. Students will also learn the weakness of the IRR method when
comparing two or more projects.
Finally, they will evaluate these projects assuming that the projects are independent projects rather
than mutually exclusive ones. This is a hands-on experience for students who want to delve into project
valuation.
Projects
Year Project
A
Project Project Project Project Project Project
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G
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100
1000
1000
150
200
300
2
350
200
800
1000
160
400
600
3
500
100
600
1000
190
600
900
4
650
200
200
1000
200
800
1200
5
800
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1000…
Chapter 12 Solutions
Managerial Accounting (5th Edition)
Ch. 12 - Prob. 1QCCh. 12 - (Learning Objective 2) After identifying potential...Ch. 12 - Prob. 3QCCh. 12 - Prob. 4QCCh. 12 - Prob. 5QCCh. 12 - Prob. 6QCCh. 12 - Prob. 7QCCh. 12 - Prob. 8QCCh. 12 - Prob. 9QCCh. 12 - (Learning Objective 5) Which of the following...
Ch. 12 - Order the capital budgeting process (Learning...Ch. 12 - Prob. 12.2SECh. 12 - Prob. 12.3SECh. 12 - Prob. 12.4SECh. 12 - Prob. 12.5SECh. 12 - Prob. 12.6SECh. 12 - Prob. 12.7SECh. 12 - Prob. 12.8SECh. 12 - Prob. 12.9SECh. 12 - Prob. 12.10SECh. 12 - Prob. 12.11SECh. 12 - Prob. 12.12SECh. 12 - Prob. 12.13SECh. 12 - Prob. 12.14SECh. 12 - Prob. 12.15SECh. 12 - Identify ethical standards violated (Learning...Ch. 12 - Prob. 12.17AECh. 12 - Compute payback period and analyze changes...Ch. 12 - Prob. 12.19AECh. 12 - Prob. 12.20AECh. 12 - Prob. 12.21AECh. 12 - Prob. 12.22AECh. 12 - Calculate the payback and NPV for a sustainable...Ch. 12 - Prob. 12.24AECh. 12 - Prob. 12.25AECh. 12 - Prob. 12.26AECh. 12 - Prob. 12.27AECh. 12 - Prob. 12.28AECh. 12 - Prob. 12.29AECh. 12 - Prob. 12.30AECh. 12 - Prob. 12.31AECh. 12 - Prob. 12.32AECh. 12 - Prob. 12.33AECh. 12 - Prob. 12.34AECh. 12 - Prob. 12.35AECh. 12 - Prob. 12.36BECh. 12 - Prob. 12.37BECh. 12 - Prob. 12.38BECh. 12 - Prob. 12.39BECh. 12 - Prob. 12.40BECh. 12 - Prob. 12.41BECh. 12 - Prob. 12.42BECh. 12 - Prob. 12.43BECh. 12 - Prob. 12.44BECh. 12 - Prob. 12.45BECh. 12 - Prob. 12.46BECh. 12 - Prob. 12.47BECh. 12 - Prob. 12.48BECh. 12 - Prob. 12.49BECh. 12 - Prob. 12.50BECh. 12 - Prob. 12.51BECh. 12 - Prob. 12.52BECh. 12 - Prob. 12.53BECh. 12 - Prob. 12.54BECh. 12 - Prob. 12.55APCh. 12 - Prob. 12.56APCh. 12 - Prob. 12.57APCh. 12 - Prob. 12.58APCh. 12 - Prob. 12.59BPCh. 12 - Prob. 12.60BPCh. 12 - Evaluate an investment using all four methods...Ch. 12 - Prob. 12.62BPCh. 12 - Prob. 12.63SCCh. 12 - Discussion Questions 1. Describe the capital...Ch. 12 - Prob. 12.65ACTCh. 12 - Prob. 12.66ACTCh. 12 - Prob. 12.67ACT
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Similar questions
- Homework i A company is considering three alternative investment projects with different net cash flows. The present value of net cash flows is calculated using Excel and the results follow. Potential Projects. Present value of net cash flows (excluding initial investment) Initial investment. Complete this question by entering your answers in the tabs below. Required A a. Compute the net present value of each project. b. If the company accepts all positive net present value projects, which of these will it accept? c. If the company can choose only one project, which will it choose on the basis of net present value? FI Compute the net present value of each project. Potential Projects Project A Present value of net cash flows Initial investment Net present value 2 Required B W F2 # Required C 3 APR 11 80 F3 $ 4 m tv 6 Project A $ 9,972 (10,000) 2 of 8 c F6 # & 7 Project B $ 10,697 (10,000) F7 Next > Y U il A 8 Project C $ 10,653 (10,000) FB DD ( F9 9 FU Oarrow_forwardLearning Task 5-8.6 Stem Options: Choose the best answer. 1. Which of the following is not considered a purpose of taxation? a. To regulate inflation b. To minimize the adverse effects of certain activities c. To have an equitable distribution of wealth among inhabitants d. To make the poor p0orer 2. Which of the following is not one of the inherent powers of a government? a. Eminent domain c. Taxation b. Police power d. Kelly power 3. The following are the principles of a sound tax system except: a. Revenues should be sufficient to pay government expenses b. Taxes must be unreasonably burdensome to the taxpayer c. Taxes must be optional; taxpayers may or may not pay their taxes d. Paying taxes must not grossly inconvenient to the taxpayers 4. They are characteristics of tax except for: a. It is proportionate in character b. It is imposed primarily to raise revenues for the government c. It is generally payable in kind d. It is levied for public purposes 5. A tax which the taxpayer can…arrow_forwardThink about your investment possibilities for 3 years holding period in real investment environment. i) What could be your investment objectives?ii) What type(-es) of investment vehicles would be relevant to you? Why? iii) What factors would be critical for your investment decision making in this particular investment environment?arrow_forward
- A. Give one example of situation in investment possibilities for 3 years holding period in real investment environment. B. What type(-es) of investment vehicles would be relevant to you? Why? C. What factors would be critical for your investment decision making in this particular investment environment?arrow_forwardFor this assignment, you will apply what you have learned from the unit lesson and required unit resources. The Waterways (WP27) case is located on page 27-35 of the textbook. Waterways puts much emphasis on cash flow when it plans for capital investments. The company chose its discount rate of 8% based on the rate of return that it must pay its owners and creditors. Using that rate, Waterways then uses different methods to determine the best decisions for making capital outlays. This year, Waterways is considering buying five new backhoes to replace the backhoes it now has. The new backhoes are faster, cost less to run, provide for more accurate trench digging, have comfort features for the operators, and have 1-year maintenance agreements to go with them. The old backhoes are working just fine, but they do require considerable maintenance. The backhoe operators are very familiar with the old backhoes and would need to learn some new skills to use the new backhoes. The following…arrow_forwardAdditionally, regarding the project, please do not assume that the reader is familiar with the subject areas that you are writing about. Therefore, definitions, assumptions, facts, and analyses are required in this assignment. Further, there are four questions that are being asked. Three questions need supporting calculations to validate your answers. Please help me by showing the calculations and assumptions in each of the answers, otherwise I will receive an 0. Kindly show your calculations. Also, a review of Learning Objective 4 in chapter 21 would be a good place to start with this assignment (Lease Capitalization, Bargain purchase Option.) Below are the questions for your convenience. What ethical issue is at stake? Should the controller's argument be accepted if she does not really know much about copier technology? Would it make a difference if the controller were knowledgeable about the rate of change in copier technology? What should Suffolk do?arrow_forward
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